Taza Sets the (Chocolate) Bar for Direct Trade and Ethical Sourcing

Taza Chocolate is a bean-to-bar chocolate company that launched in Somerville, Massachusetts in 2005. Priding themselves on their unique stone-ground processing technique, which grinds organic cacao beans into “perfectly unrefined, minimally processed chocolate,” (Taza Website) Taza strives to provide a special blend of bold flavor and texture through their chocolate products. However, perhaps their most noteworthy trademark as a chocolate company is their commitment to ethical cacao sourcing that features the relationships with the farmers from whom they obtain their cacao beans. Specifically, Taza has formed Direct Trade relationships with five cacao producers around South America and the Caribbean. As documented through their groundbreaking annual cacao sourcing transparency reports, Taza contributes to the global problems facing the cacao-chocolate supply chain by keying in on each level within their supply chain- both the farmers who cultivate the product and the partners who source the cacao. Through their unique methodology and commitment, Taza achieves paying premium prices that reach their partners and promoting fair labor practices.

TazaPartners

For chocolate companies, forming strong, healthy relationships with both the farmers and companies from which they source their cacao seems like an obvious solution to the problematic cacao-producing industry, but it is more difficult and less observed in practice. While conventional practice for firms to promote fair labor practices features obtaining a Fair Trade certification, Taza has done an effective job of this using the alternative Direct Trade model. While Fair Trade aims to more justly compensate marginalized producers, it creates unintended consequences. For example, little of the extra money produced by a Fair Trade agreement reaches the developing countries, and of that, less reaches the farmers (Sylla, 2014). One reason for this is the cost to obtain a Fair Trade certification, shouldered by the producers, is the same everywhere, meaning that the poorest countries have the most difficulty obtaining the certification (Sylla, 2014; Martin, 2018, Lecture 9). Conversely, Direct Trade circumvents any fees required for certification and privatizes the contractual relationship so that the producers do not bear unnecessary costs. Taza was the first chocolate maker in the United States to establish a third-party certified Direct Trade Cacao sourcing program (Taza Website). Direct trade is “a form of sourcing practiced by some coffee roasters and chocolate companies with standards varying between produces” (Martin, 2018, Lecture 5). While relationships are often fragile and temporary between chocolate companies and cacao farmers that participate in Direct Trade (Martin, 2018, Lecture 9), Taza has taken notable steps to ensure a healthy relationship that truly benefits everyone, from the cacao farmer to the consumer.

Specifically, as one part of their relationships with their partners through the Direct Trade model, Taza physically visits each partner at least once per year to build trust and compassion. As seen on Taza’s Facebook page through founder Alex Whitmore’s trip to partner PISA in Haiti, Taza places an emphasis on connecting with both their partners and the farmers from whom their partners receive cacao to create a truly interconnected supply chain. Whitmore and company are seen sharing their Taza product with Haitian farmers, a gesture that is representative of their close relationship. By connecting with PISA, Taza, as Whitmore describes, has highlighted the strengths of two entities and brought them together to make something great. While Haiti’s cacao beans are comparable to those found in the Dominican Republic, failure to properly dry and ferment these beans left their exquisite taste to go unrecognized and their cacao to be sold at a heavily discounted price.  PISA specializes in these processes (Leissle, 2013). This relationship has led to Taza sourcing the first ever Certified USDA Organic Cacao from Haiti and PISA and the farmers being paid a premium price for the cacao that they have been able to provide (Taza Website).

Taza’s 2016 Transparency Report features their combating another major influential factor facing the global cacao-chocolate supply chain: the price of cacao. Daunted by unstable cacao market prices, government control of purchasing and distributing, and supply chain intermediaries squeezing profits, cacao farmers fall victim to extremely low incomes. (Sylla, 2014). In the agricultural crisis in the 1970’s, West African governments used marketing boards and caisse systems to force cacao farmers to sell at prices below the world price and use the proceeds towards industrialization (Martin, 2018, Lecture 7). Today, intermediaries have inserted themselves in the supply chain of these cacao-dependent communities, squeezing profits throughout the supply chain and leaving cacao farmers with the bare minimum. Specifically, they have garnered strong market power through horizontal and vertical integration. At each level of the supply chain, competition has driven many players out, allowing these intermediaries to accomplish horizontal integration. By broadening their responsibilities within the supply chain, they have also achieved vertical integration (Sylla, 2014).

By ensuring a share of the premium prices they pay their sourcing partners reaches the farmers themselves, Taza plays their part in combatting the global lack of cacao farmer compensation. Taza’s Direct Trade relationship with their partners contributes to their communities through paying premium prices for the cacao to the processors and ensuring that the said premium reaches the farmers themselves. Analyzed in their 2016 Transparency Report here, Taza pays their partners at least $500 above the market price- a 15-20% premium, and never less than $2,800 per metric ton for cacao, protecting their partners against extremely low world market prices. For Jesse Last, Taza’s Chocolate Cocoa Sourcing Manager, knowing what they pay their cacao sourcing partners wasn’t enough. In 2016, Last took steps to ensure that cacao farmers were getting a slice of the cake too. Specifically, he updated Taza’s Direct Trade agreement to include a commitment by their partners to “provide documentation demonstrating the compensation paid to farmers and/or employees, as well as facilitate conversation between farmers and Taza” (Taza Website).

When Last visited these farms ensure their shares were received, he found no discrepancies between their reports and the payments documented by their own partners. Furthermore, Last provided an in-depth analysis (5 Steps Towards Understanding Price) within the transparency report that contextualizes farmer compensations received from their origin partners, and found that all but one of their partners is paying above the world market average per metric ton of cacao and “some” by almost twice as much (Taza Website). The extensive effort displayed by Jesse Last and Taza sets the standard that not just bean-to-bar, but all chocolate companies around the world should strive to meet in regard to paying the cacao farmers a reasonable salary. While obstacles, like those previously mentioned, often intervene with guaranteed fair wages for farmers, Taza has taken a uniquely ethical path not only to ensure this but also to strengthen the relationship between their partners and the farmers and to spread this methodology through the transparency report for the world to see. Their effort to affect others in an ethical fashion does not end with their suppliers- it extends all the way to their consumers.

As further part of their Direct trade Commitment, Taza requires all their cacao be USDA Certified Organic and Non-GMO Project Verified, as can be seen on one of their chocolate bars below, providing a healthy blend of ingredients in their chocolate for their consumers. While every Taza chocolate product contains the seal of Certified USDA Organic and Non-GMO Project Verified, they are also Kosher, soy-free, dairy-free, and vegan. Taza’s effort to source organic sugar is especially noteworthy. They have partnered with The Native Green Cane Project, recognized by The World Economic Forum, the Boston Consulting Group, the Union for Ethical BioTrade, and other organizations “as one of the world’s leading examples of innovative agriculture and sustainability’ (Taza Website). The traditional cultivation method of burning sugar cane unavoidably releases toxic gases and substantially contributes to biodiversity loss. The Native Green Cane Project has made a positive environmental impact by designing a mechanical harvester that eliminates toxic gas emissions and saves water that would otherwise be used to clean burnt cane. Furthermore, this practice eliminates the use of synthetic fertilizers, genetically modified organisms, and pesticides, making for a safer labor environment. Through these organic methodologies, Taza not only provides healthier products for their consumers but also contributes to a cleaner environment while promoting safer working conditions.

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TazaCertifications

 

To guarantee the integrity of their Direct Trade program, Taza has had Quality Certification Services, a USDA-accredited organic certifier out of Gainesville, Florida independently verify the upholding of five Direct Trade claims, outlined on their website. To verify annual visits to their partners, Taza provides flight receipts or e-tickets. To verify paying their cacao producers a premium rate, they provide annual invoices completed by their Sourcing Manager and the cacao-producing partner. To ensure the exclusive usage of USDA certified cacao, they provide proper certification documentation from their partners and farmers. Taza’s commitment to diminish the problems that have plagued much of the cacao industry for centuries, specifically its producers, can be seen by their initiative to hold themselves accountable in the continuation of these practices that benefit the producers, consumers, and everyone in between.

While Taza has contributed immensely by enhancing their relationships with their origin partners, one way they could improve their outreach is by expanding to West Africa. West Africa produces 75 percent of the world’s cacao, but they have an extensive and continued history of child labor exploitation. Evidence of child slavery in Cote d’Ivore has been recorded as recently as the early 2000’s (Off, 2008). In other countries such as Ghana, children have limited freedom to choose to go into labor (Berlan, 2013). This undeniable evidence highlights deep internal roots that drive these continued unethical labor practices and the need for intervention from outside parties- specifically from local government, international entities, and corporations. However, these entities have had limited effect on changing the scope of West African cacao production over the years. U.S. Representative Eliot Engel drafted a bill proposing the implementation a detailing a labeling system, classifying goods as “slave free” if it could be proved that slavery was not used in their production. However, significant pushback from industry giants like Hershey’s and Mars gave themselves more time to investigate and improve the labor practices behind the production of their chocolate (Off, 208). The Harkin-Engel protocol was then passed in 2001 to eliminate the worst forms of child labor in Cote d’Ivore and Ghana, but the extent of its impact remains in question today (Ryan, 2011).

Taza could potentially break the stigma that West Africa is a poor investment for these artisan chocolate makers. However, considering the obstacles in play, Taza would need to stumble upon a perfect situation- one that might not exist now. Ghana’s Cocoa Board controls exports, limiting the ability of artisan chocolate makers to source cacao from farmers. Taza would likely need to look to other countries, such as the Ivory Coast. The Ivory Coast completely deregulated its market, meaning Taza could directly contact farmers and cooperatives as they do with their five current partners. The problem then would be the quality of cacao. Cacao beans emit varying flavors and textures depending on strain and terroir, and Taza, like most bean-to-bar companies, prides itself on the unique tastes produced by the terroir of the regions from which they source their cacao. Despite being the biggest producer in the world, West Africa is known for producing very few single origin bars. In Christian’s Chocolate Census, the most comprehensive online database for chocolate, 3.8% of 1500 chocolate products contain beans exclusively from West Africa. U.S. chocolate artisan companies like Taza cite bean strain and scale of production for their avoiding West African cacao to source single origin chocolates. Farmers in West Africa predominantly grow direct-sun-tolerant, pest- and disease-resistant hybrid cacao beans, which are usually weak in flavor or bitter (Leissle, 2013). Furthermore, these regions operate on a large scale, making it difficult for small artisan companies to buy beans in smaller quantities. These regions typically will not sell in small quantities even if Taza offered a high premium for their beans. If Taza could somehow find a way into the small community of the Ivory Coast with quality cacao, they could impact that community through their commitment to relationships and premium prices. More importantly, they might open the door for other artisan – specifically bean-to-bar- chocolate companies By showing that it is possible to ethically source quality cacao from West Africa.

Overall, Taza sets a notable example for the chocolate industry by doing their part to combat the global problems facing cacao producers. Specifically, the Direct Trade method of sourcing cacao that Taza has adopted has allowed them to form strong relationships with their partners by connecting face-to-face at least once per year. By circumventing profit-squeezing middlemen present in the more widely practice Fair Trade method, Taza ensures that both their cacao-sourcing partners and the farmers get a fair share of the profits that their cacao generates. Furthermore, their awareness and commitment to uphold these practices is obvious as displayed through their unique transparency reports and third-party certifier. While Taza could up the ante by seeking to take on the most corrupt cacao-producing region in the world, West Africa, they would face many challenges- namely finding a Direct Trade partner and flavorful cacao-beans- that would danger upholding their current model of ethical sourcing. Taza, while only a small bean-to-bar chocolate company, must continue their commitment to ethical partnerships with cacao-producers and to transparency of these partnerships. They set the bar high (100% cacao…just kidding) for other bean-to-bar companies and show bigger conglomerates the potential to contribute to cacao producers around the world.

 

 

 

Works Cited:

Berlan, A. (2013). Social Sustainability in Agriculture: An Anthropological Perspective on Child Labour in Cocoa Production in Ghana. The Journal of Development Studies, 49(8), 1088-1100.

Leissle, K. (2013). Invisible West Africa. The Politics of Single Origin Chocolate. Gastronomica: The Journal of Food and Culture, 13(3), 22-31.

Martin, C. (2018). (Lectures 5, 8, 9).

Off, C. (2008). Bitter chocolate : The dark side of the world’s most seductive sweet. New York: New Press.

Ryan, Órla, International African Institute, Royal African Society, & Social Science Research Council. (2011). Chocolate Nations (African arguments.). Zed Books.

Sylla, N., & Leye, David Clément. (2014). The fair trade scandal: Marketing poverty to benefit the rich. Athens, Ohio: Ohio University Press.

“Taza Direct Trade.” Taza Chocolate, http://www.tazachocolate.com/pages/taza-direct-trade.

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